Research and development Research and development RD is

Research and development

Research and development (R&D) is the scientific research and the technical development involved in developing new products or processes

Reasons for new product development New product development (NPD) is the process which identifies, develops & tests new product opportunities NPD is carried out for a number of reasons: To replace declining products To add to the current portfolio To fill a gap in the market To maintain competitive advantage To compete with rival products To attract new customers

Process of R&D Idea generation Idea screening & concept testing Product design brief prepared Prototypes made & tested (may be discarded, adapted or adopted) Test marketing Full scale production Launch (supported by promotion)

Benefits of R&D Developing unique products (USP) Provides competitive advantage Provides long-term income Identifies new opportunities Improves efficiency of production processes Enhances reputation

Challenges and costs of R&D High financial costs Long timescales Uncertain outcomes Conditions may change during the R&D process Reactions of rival companies Possibility of failure and the associated impact on reputation

Market & product orientation Where do the product ideas come from? Market orientation – new products are developed based on customer wants which are found through market research Product orientation – ideas are developed from scientific investigation and technical research within the company